• Teradyne Reports Second Quarter 2021 Results

    Источник: Nasdaq GlobeNewswire / 27 июл 2021 16:02:01   America/Chicago

    • Revenue of $1,086 million in Q2’21 grew 29% from Q2’20 and 92% from Q2’19
    • GAAP Gross Margin 59.6% in Q2’21, up from 56.2% in Q2’20 and 57.4% in Q2’19
    • Q2’21 GAAP earnings per share grew 68% from Q2’20 and 220% from Q2’19
    • Q2’21 non-GAAP earnings per share grew 44% from Q2’20 and 189% from Q2’19
    • Test revenue grew 27% from Q2’20 and 103% from Q2’19 on Semiconductor Test strength
    • Industrial Automation revenue grew 57% from Q2’20 and 23% from Q2’19 on global demand growth at Universal Robots
    • Q3’21 Revenue guidance at mid-point represents 12% growth from Q3’20 and 58% from Q3’19
     Q2'21Q2'20Q1'211H’211H’20
    Revenue (mil)$1,086$839 $782 $1,867$1,543
    GAAP EPS$1.76$1.05 $1.09 $2.85$2.02
    Non-GAAP EPS$1.91$1.33 $1.11 $3.02$2.34

    NORTH READING, Mass., July 27, 2021 (GLOBE NEWSWIRE) -- Teradyne, Inc. (NASDAQ: TER) reported revenue of $1,086 million for the second quarter of 2021 of which $834 million was in Semiconductor Test, $105 million in System Test, $55 million in Wireless Test and $92 million in Industrial Automation (IA). GAAP net income for the second quarter was $328.3 million or $1.76 per diluted share. On a non-GAAP basis, Teradyne’s net income in the second quarter was $337.5 million, or $1.91 per diluted share, which excluded acquired intangible asset amortization, restructuring and other charges, non-cash convertible debt interest, and included the related tax impact on non-GAAP adjustments.

    “Test demand across all of our end markets remained high in the second quarter and the strong recovery in our Industrial Automation business broadened geographically,” said Teradyne CEO and President Mark Jagiela. “System on a chip (SOC) test shipments were exceptionally strong in the quarter growing nearly 30% from last year’s record level. In Industrial Automation, Universal Robots delivered growth in North America, Europe and China compared with both 2020 and 2019 as the improving global economy and expanding range of automation solutions we offer powered our highest quarterly group revenue on record.

    “As we look ahead, our Q3 outlook reflects continued strong demand from both our Test and Industrial Automation end markets and, at the mid-point of our guidance, puts us on track to grow sales 12% and GAAP and non-GAAP earnings per share 7% and 20%, respectively, from our Q3’20 levels.”

    Guidance for the third quarter of 2021 is revenue of $880 million to $960 million, with GAAP net income of $1.17 to $1.41 per diluted share and non-GAAP net income of $1.29 to $1.55 per diluted share. Non-GAAP guidance excludes acquired intangible asset amortization, non-cash convertible debt interest and includes the related tax impact on non-GAAP adjustments.

    Webcast
    A conference call to discuss the second quarter results, along with management's business outlook, will follow at 8:30 a.m. ET, Wednesday, July 28. Interested investors should access the webcast at www.teradyne.com and click on "Investors" at least five minutes before the call begins. Presentation materials will be available starting at 8:30 a.m. ET. A replay will be available on the Teradyne website at https://investors.teradyne.com/events-presentations.

    Non-GAAP Results
    In addition to disclosing results that are determined in accordance with GAAP, Teradyne also discloses non-GAAP results of operations that exclude certain income items and charges. These results are provided as a complement to results provided in accordance with GAAP. Non-GAAP income from operations and non-GAAP net income exclude acquired intangible assets amortization, non-cash convertible debt interest, losses on convertible debt conversions, pension actuarial gains and losses, discrete income tax adjustments, fair value inventory step-up, and restructuring and other, and includes the related tax impact on non-GAAP adjustments. GAAP requires that these items be included in determining income from operations and net income. Non-GAAP income from operations, non-GAAP net income, non-GAAP income from operations as a percentage of revenue, non-GAAP net income as a percentage of revenue, and non-GAAP net income per share are non-GAAP performance measures presented to provide meaningful supplemental information regarding Teradyne’s baseline performance before gains, losses or other charges that may not be indicative of Teradyne’s current core business or future outlook. These non-GAAP performance measures are used to make operational decisions, to determine employee compensation, to forecast future operational results, and for comparison with Teradyne’s business plan, historical operating results and the operating results of Teradyne’s competitors. Non-GAAP gross margin excludes fair value inventory step-up. GAAP requires that this item be included in determining gross margin. Non-GAAP gross margin dollar amount and percentage are non-GAAP performance measures that management believes provide useful supplemental information for management and the investor. Management uses non-GAAP gross margin as a performance measure for Teradyne’s current core business and future outlook and for comparison with Teradyne’s business plan, historical gross margin results and the gross margin results of Teradyne’s competitors. Non-GAAP diluted shares include the impact of Teradyne’s call option on its shares. Management believes each of these non-GAAP performance measures provides useful supplemental information for investors, allowing greater transparency to the information used by management in its operational decision making and in the review of Teradyne’s financial and operational performance, as well as facilitating meaningful comparisons of Teradyne’s results in the current period compared with those in prior and future periods. A reconciliation of each available GAAP to non-GAAP financial measure discussed in this press release is contained in the attached exhibits and on the Teradyne website at teradyne.com by clicking on “Investor Relations” and then selecting “Financials” and the “GAAP to Non-GAAP Reconciliation” link. The non-GAAP performance measures discussed in this press release may not be comparable to similarly titled measures used by other companies. The presentation of non-GAAP measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP.

    About Teradyne
    Teradyne (NASDAQ:TER) brings high-quality innovations such as smart devices, life-saving medical equipment and data storage systems to market, faster. Its advanced test solutions for semiconductors, electronic systems, wireless devices and more ensure that products perform as they were designed. Its Industrial Automation offerings include collaborative and mobile robots that help manufacturers of all sizes improve productivity and lower costs. In 2020, Teradyne had revenue of $3.1 billion and today employs 5,600 people worldwide. For more information, visit teradyne.com. Teradyne® is a registered trademark of Teradyne, Inc. in the U.S. and other countries.

    Safe Harbor Statement
    This release contains forward-looking statements regarding Teradyne’s future business prospects, the impact of the COVID-19 pandemic, results of operations, market conditions, earnings per share, the payment of a quarterly dividend, the repurchase of Teradyne common stock pursuant to a share repurchase program, and the impact of U.S. and Chinese export and tariff laws. Such statements are based on the current assumptions and expectations of Teradyne’s management and are neither promises nor guarantees of future performance, events, earnings per share, use of cash, payment of dividends, repurchases of common stock, payment of the senior convertible notes, the impact of the COVID-19 pandemic, or the impact of U.S. and Chinese export and tariff laws. There can be no assurance that management’s estimates of Teradyne’s future results or other forward-looking statements will be achieved. Additionally, the current dividend and share repurchase programs may be modified, suspended or discontinued at any time.

    On May 16, 2019, Huawei and 68 of its affiliates, including HiSilicon, were added to the U.S. Department of Commerce Entity List under U.S. Export Administration Regulations (the “EAR”). This action by the U.S. Department of Commerce imposed new export licensing requirements on exports, re-exports, and in-country transfers of all U.S. - regulated products, software and technology to the designated Huawei entities. While most of Teradyne’s products are not subject to the EAR and therefore were not affected by the Entity List restrictions, some of its products are currently manufactured in the U.S. and thus subject to the Entity List restrictions.

    On August 17, 2020, the U.S. Department of Commerce published final regulations expanding the scope of the U.S. EAR to include additional products that became subject to export restrictions relating to Huawei entities including HiSilicon. These new regulations restrict the sale to Huawei and the designated Huawei entities of certain non-U.S. made items, such as semiconductor devices, manufactured for or sold to Huawei entities including HiSilicon under specific, detailed conditions set forth in the new regulations. These new regulations have impacted our sales to Huawei, HiSilicon and their suppliers. Teradyne is taking appropriate actions, including filing for licenses with the U.S. Department of Commerce and working with the U.S. regulators to clarify the scope of the restrictions. However, Teradyne cannot be certain that the actions it takes will mitigate the risks associated with the new export controls that impact its business. It is uncertain the extent these new regulations and any other additional regulations that may be implemented by the U.S. Department of Commerce or other government agency may have on Teradyne’s business and financial results.

    On April 28, 2020, the U.S. Department of Commerce published new export control regulations for certain U.S. products and technology sold to military end users or for military end-use in China, Russia and Venezuela. The definition of military end user is broad. The regulations went into effect on June 29, 2020. In December 2020, the U.S. Department of Commerce issued a list of companies in China and other countries that it considered to be military end users. Teradyne does not expect that compliance with the new export controls will significantly impact its ability to sell products to its customers in China or to manufacture products in China. The new export controls, however, could disrupt the Company’s supply chain, increase compliance costs and impact the demand for the Company’s products in China and, thus, have a material adverse impact on Teradyne’s business, financial condition or results of operations. In addition, while the Company maintains an export compliance program, its compliance controls could be circumvented, exposing the Company to legal liabilities. Teradyne continues to assess the potential impact of the new export controls on its business and operations and take appropriate actions, including filing for licenses with the U.S. Department of Commerce, to minimize any disruption. However, Teradyne cannot be certain that the actions it takes will mitigate all the risks associated with the new export controls that may impact its business.

    In response to the regulations issued by the U.S. Department of Commerce, the Chinese government has passed new laws that may impact Teradyne’s business activities in China. The Company is assessing the potential impact of these new Chinese laws and monitoring relevant laws and regulations issued by the Chinese government.

    The global pandemic of the novel strain of the coronavirus (COVID-19) has resulted in authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter in place orders, and shutdowns. These measures have impacted and may further impact Teradyne’s workforce and operations, the operations of its customers, and those of its contract manufacturers and suppliers. The COVID-19 pandemic has adversely impacted the Company’s results of operations, including increased costs company-wide and decreased sales in its industrial automation businesses. The Company cannot accurately estimate the amount of the impact on Teradyne’s 2021 financial results and to its future financial results. The COVID-19 outbreak has significantly increased economic and demand uncertainty in Teradyne’s markets. This uncertainty resulted in a significant decrease in demand for certain Teradyne products and could continue to impact demand for an uncertain period of time. The spread of COVID-19 has caused Teradyne to modify its business practices (including employee travel, employees working remotely, and cancellation of physical participation in meetings, events and conferences) and the Company may take further actions as may be required by government authorities or that it determines are in the best interests of its employees, customers, contract manufacturers and suppliers. There is uncertainty that such measures will be sufficient to mitigate the risks posed by the virus, and Teradyne’s ability to perform critical functions could be impacted. The degree to which COVID-19 impacts Teradyne’s results will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and continued surge of the virus, its severity, the actions to contain the virus or the availability and impact of vaccines in countries where the Company does business, and how quickly and to what extent normal economic and operating conditions can resume.

    Important factors that could cause actual results, earnings per share, use of cash, dividend payments, repurchases of common stock, or payment of the senior convertible notes to differ materially from those presently expected include: conditions affecting the markets in which Teradyne operates; decreased or delayed product demand from one or more significant customers; development, delivery and acceptance of new products; the ability to grow the Industrial Automation business; increased research and development spending; deterioration of Teradyne’s financial condition; the continued impact of the COVID-19 pandemic and related government responses on the market and demand for Teradyne’s products, on its contract manufacturers and supply chain, and on its workforce; the impact of the global semiconductor supply shortage on our supply chain and contract manufacturers; the consummation and success of any mergers or acquisitions; unexpected cash needs; insufficient cash flow to make required payments and pay the principal amount on the senior convertible notes; the business judgment of the board of directors that a declaration of a dividend or the repurchase of common stock is not in the company’s best interests; additional U.S. tax regulations or IRS guidance; the impact of any tariffs or export controls imposed in the U.S. or China; compliance with trade protection measures or export restrictions; the impact of U.S. Department of Commerce or other government agency regulations relating to Huawei and HiSilicon; and other events, factors and risks disclosed in filings with the SEC, including, but not limited to, the “Risk Factors” sections of Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and Quarterly Report on Form 10-Q for the fiscal quarter ended April 4, 2021. The forward-looking statements provided by Teradyne in this press release represent management’s views as of the date of this release. Teradyne anticipates that subsequent events and developments may cause management’s views to change. However, while Teradyne may elect to update these forward-looking statements at some point in the future, Teradyne specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Teradyne’s views as of any date subsequent to the date of this release.

               
    TERADYNE, INC. REPORT FOR SECOND FISCAL QUARTER OF 2021          
                  
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS   
        
                  
         Quarter Ended Six Months Ended
         July 4,
    2021    		 April 4,
    2021    		 June 28,
    2020    		 July 4,
    2021    		 June 28,
    2020
                  
    Net revenues $1,085,728  $781,606  $838,661  $1,867,334  $1,543,016 
     Cost of revenues (exclusive of acquired intangible assets amortization shown separately below) (1)  438,739   319,988   367,188   758,727   665,993 
                  
    Gross profit  646,989   461,618   471,473   1,108,607   877,023 
                  
    Operating expenses:          
     Selling and administrative  140,187   129,797   113,259   269,984   224,647 
     Engineering and development  110,021   100,402   94,102   210,423   179,261 
     Acquired intangible assets amortization  5,402   5,536   8,941   10,938   18,832 
     Restructuring and other (2)  2,507   (7,130)  37,222   (4,623)  29,616 
       Operating expenses  258,117   228,605   253,524   486,722   452,356 
                  
    Income from operations  388,872   233,013   217,949   621,885   424,667 
                  
     Interest and other expense (3)  4,846   9,020   658   13,866   10,308 
                  
    Income before income taxes  384,026   223,993   217,291   608,019   414,359 
     Income tax provision  55,707   18,481   28,383   74,188   49,261 
    Net income $328,319  $205,512  $188,908  $533,831  $365,098 
                  
    Net income per common share:          
    Basic   $1.98  $1.23  $1.14  $3.21  $2.20 
    Diluted   $1.76  $1.09  $1.05  $2.85  $2.02 
                  
    Weighted average common shares - basic  165,995   166,491   165,789   166,243   166,189 
                  
    Weighted average common shares - diluted (4)  186,750   187,740   180,257   187,245   180,497 
                  
                  
    Cash dividend declared per common share $0.10  $0.10  $0.10  $0.20  $0.20 
                  
                  
                  
    (1)Cost of revenues includes: Quarter Ended Six Months Ended
         July 4,
    2021    		 April 4,
    2021    		 June 28,
    2020    		 July 4,
    2021    		 June 28,
    2020
       Provision for excess and obsolete inventory $798  $2,827  $5,580  $3,625  $9,637 
       Sale of previously written down inventory  (428)  (790)  (337)  (1,218)  (1,414)
       Inventory step-up  -   -   121   -   239 
         $370  $2,037  $5,364  $2,407  $8,462 
                  
    (2)Restructuring and other consists of: Quarter Ended Six Months Ended
         July 4,
    2021    		 April 4,
    2021    		 June 28,
    2020    		 July 4,
    2021    		 June 28,
    2020
       Employee severance $436  $188  $36  $624  $764 
       Acquisition related expenses and compensation  275   (237)  3,145   38   4,503 
       Contingent consideration fair value adjustment  -   (7,227)  29,259   (7,227)  19,239 
       Contract termination settlement fee  -   -   4,000   -   4,000 
       Other  1,796   146   782   1,942   1,110 
         $2,507  $(7,130) $37,222  $(4,623) $29,616 
                  
    (3)Interest and other includes: Quarter Ended Six Months Ended
         July 4,
    2021    		 April 4,
    2021    		 June 28,
    2020    		 July 4,
    2021    		 June 28,
    2020
       Non-cash convertible debt interest $3,277  $3,581  $3,584  $6,858  $7,124 
       Loss on convertible debt conversions  1,175   4,069   -   5,244   - 
       Pension actuarial gains  (627)  -   (99)  (627)  (99)
         $3,825  $7,650  $3,485  $11,475  $7,025 
                  
    (4)Under GAAP, when calculating diluted earnings per share, convertible debt must be assumed to have converted if the effect on EPS would be dilutive. Diluted shares assume the conversion of the convertible debt as the effect would be dilutive. Accordingly, for the quarters ended July 4, 2021, April 4, 2021 and June 28, 2020, 9.6 million, 10.3 million and 7.6 million shares, respectively, have been included in diluted shares. For the six months ended July 4, 2021 and June 28, 2020, 9.9 million and 7.5 million shares, respectively have been included in diluted shares. For the quarters ended July 4, 2021, April 4, 2021, and June 28, 2020, diluted shares also included 10.1 million, 9.4 million and 5.8 million shares, respectively from the convertible note hedge transaction. For the six months ended July 4, 2021, and June 28, 2020, diluted shares included 9.8 million and 5.7 million shares, respectively from the convertible note hedge transaction.
       


    CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)    
            
         July 4,
    2021    		 December 31,
    2020
    Assets      
     Cash and cash equivalents $954,441  $914,121 
     Marketable securities  282,121   522,280 
     Accounts receivable, net  868,457   497,506 
     Inventories, net  226,138   222,189 
     Prepayments and other current assets  368,315   259,338 
       Total current assets  2,699,472   2,415,434 
            
     Property, plant and equipment, net  395,395   394,800 
     Operating lease right-of-use assets, net  61,849   54,569 
     Marketable securities  181,560   117,980 
     Deferred tax assets  94,438   87,913 
     Retirement plans assets  17,170   17,468 
     Other assets  21,320   9,384 
     Acquired intangible assets, net  88,121   100,939 
     Goodwill  441,597   453,859 
            
       Total assets $4,000,922  $3,652,346 
            
    Liabilities     
     Accounts payable $156,103  $133,663 
     Accrued employees' compensation and withholdings  205,717   220,321 
     Deferred revenue and customer advances  148,882   134,662 
     Other accrued liabilities  146,484   77,581 
     Operating lease liabilities  20,539   20,573 
     Income taxes payable  93,876   80,728 
     Current debt  213,761   33,343 
            
       Total current liabilities  985,362   700,871 
            
     Retirement plans liabilities  154,311   151,140 
     Long-term deferred revenue and customer advances  58,534   58,359 
     Long-term contingent consideration  -   7,227 
     Long-term other accrued liabilities  19,387   19,352 
     Deferred tax liabilities  8,961   10,821 
     Long-term operating lease liabilities  49,066   42,073 
     Long-term income taxes payable  67,041   74,930 
     Debt   143,618   376,768 
            
       Total liabilities  1,486,280   1,441,541 
            
    Mezzanine equity  21,386   3,787 
            
    Shareholders' equity  2,493,256   2,207,018 
            
       Total liabilities, convertible common shares and shareholders’ equity $4,000,922  $3,652,346 
            


    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)        
                
         Quarter Ended Six Months Ended
         July 4,
    2021    		 June 28,
    2020    		 July 4,
    2021    		 June 28,
    2020
    Cash flows from operating activities:        
     Net income $328,319  $188,908  $533,831  $365,098 
     Adjustments to reconcile net income to net cash provided by operating activities:        
      Depreciation  21,938   19,816   45,848   38,305 
      Stock-based compensation  10,999   10,907   23,231   21,367 
      Amortization  9,521   12,843   19,343   26,234 
      Loss on convertible debt conversions  1,175   -   5,244   - 
      Provision for excess and obsolete inventory  798   5,580   3,625   9,637 
      Deferred taxes  257   (5,338)  (800)  (7,163)
      Gains on investments  (2,159)  (5,126)  (4,650)  (469)
      Retirement plans actuarial gains  (627)  (99)  (627)  (99)
      Contingent consideration fair value adjustment  -   29,259   (7,227)  19,239 
      Other  (1)  19   199   523 
                
      Changes in operating assets and liabilities, net of businesses acquired:       
       Accounts receivable  (285,186)  (204,261)  (372,698)  (331,040)
       Inventories  56,320   (19,546)  19,908   (3,728)
       Prepayments and other assets  (31,285)  (9,859)  (117,416)  (49,479)
       Accounts payable and other liabilities  97,361   148,901   86,790   113,578 
       Deferred revenue and customer advances  7,237   29,568   15,189   28,655 
       Retirement plans contributions  (814)  (1,239)  (2,739)  (2,501)
       Income taxes  (7,569)  22,564   (2,628)  37,842 
    Net cash provided by operating activities  206,284   222,897   244,423   265,999 
                
    Cash flows from investing activities:        
     Purchases of property, plant and equipment  (34,707)  (47,314)  (73,957)  (84,014)
     Purchases of marketable securities  (186,482)  (112,429)  (398,086)  (299,548)
     Proceeds from maturities of marketable securities  265,985   84,527   460,213   182,984 
     Proceeds from sales of marketable securities  54,819   11,656   116,112   26,661 
     Purchase of investment and acquisition of businesses, net of cash acquired  (12,000)  -   (12,000)  149 
     Proceeds from life insurance  -   546   -   546 
    Net cash provided by (used for) investing activities  87,615   (63,014)  92,282   (173,222)
                
    Cash flows from financing activities:        
     Issuance of common stock under stock purchase and stock option plans  15,437   5   32,581   12,757 
     Repurchase of common stock  (151,396)  (9,426)  (196,584)  (88,465)
     Dividend payments  (16,604)  (16,580)  (33,271)  (33,266)
     Payments of convertible debt principal  (15,553)  -   (66,828)  - 
     Payments related to net settlement of employee stock compensation awards  (1,119)  (449)  (31,794)  (22,519)
     Payments of contingent consideration  -   -   -   (8,852)
    Net cash used for financing activities  (169,235)  (26,450)  (295,896)  (140,345)
                
    Effects of exchange rate changes on cash and cash equivalents  (1,372)  (1,496)  (489)  (925)
    Increase (decrease) in cash and cash equivalents  123,292   131,937   40,320   (48,493)
    Cash and cash equivalents at beginning of period  831,149   593,494   914,121   773,924 
    Cash and cash equivalents at end of period $954,441  $725,431  $954,441  $725,431 
                

     

    GAAP to Non-GAAP Earnings Reconciliation
                             
    (In millions, except per share amounts)
              Quarter Ended            
      July 4,
    2021    		 % of Net Revenues     April 4,
    2021    		 % of Net Revenues     June 28,
    2020    		 % of Net Revenues    
                             
    Net revenues$1,085.7        $781.6        $838.7       
                             
    Gross profit GAAP$647.0   59.6%     $461.6  59.1%     $471.5  56.2%    
     Inventory step-up -   -       -  -       0.1  0.0%    
    Gross profit non-GAAP$647.0   59.6%     $461.6  59.1%     $471.6  56.2%    
                             
    Income from operations - GAAP$388.9   35.8%     $233.0  29.8%     $217.9  26.0%    
     Restructuring and other (1) 2.5   0.2%      (7.1) -0.9%      37.2  4.4%    
     Acquired intangible assets amortization 5.4   0.5%      5.5  0.7%      8.9  1.1%    
     Inventory step-up -   -       -  -       0.1  0.0%    
    Income from operations - non-GAAP$396.8   36.5%     $231.4  29.6%     $264.1  31.5%    
                             
          Net Income
    per Common Share    		     Net Income
    per Common Share    		     Net Income
    per Common Share
      July 4,
    2021    		 % of Net Revenues Basic  Diluted April 4,
    2021    		 % of Net Revenues Basic  Diluted June 28,
    2020    		 % of Net Revenues Basic  Diluted
    Net income - GAAP$328.3   30.2% $1.98  $1.76  $205.5  26.3% $1.23  $1.09  $188.9  22.5% $1.14  $1.05 
     Restructuring and other (1) 2.5   0.2%  0.02   0.01   (7.1) -0.9%  (0.04)  (0.04)  37.2  4.4%  0.22   0.21 
     Acquired intangible assets amortization 5.4   0.5%  0.03   0.03   5.5  0.7%  0.03   0.03   8.9  1.1%  0.05   0.05 
     Loss on convertible debt conversions (2) 1.2   0.1%  0.01   0.01   4.1  0.5%  0.02   0.02   -  -   -   - 
     Interest and other (2) 3.3   0.3%  0.02   0.02   3.6  0.5%  0.02   0.02   3.6  0.4%  0.02   0.02 
     Pension mark-to-market adjustment (2) (0.6)  -0.1%  (0.00)  (0.00)  -  -   -   -   (0.1) -0.0%  (0.00)  (0.00)
     Inventory step-up -   -   -   -   -  -   -   -   0.1  0.0%  0.00   0.00 
     Exclude discrete tax adjustments (1.1)  -0.1%  (0.01)  (0.01)  (15.1) -1.9%  (0.09)  (0.08)  (1.1) -0.1%  (0.01)  (0.01)
     Non-GAAP tax adjustments (1.5)  -0.1%  (0.01)  (0.01)  (0.3) -0.0%  (0.00)  (0.00)  (8.3) -1.0%  (0.05)  (0.05)
     Convertible share adjustment (3) -   -   -   0.10   -  -   -   0.06   -  -   -   0.06 
    Net income - non-GAAP$337.5   31.1% $2.03  $1.91  $196.2  25.1% $1.18  $1.11  $229.2  27.3% $1.38  $1.33 
                             
    GAAP and non-GAAP weighted average common shares - basic 166.0         166.5         165.8       
    GAAP weighted average common shares - diluted 186.8         187.7         180.3       
     Exclude dilutive shares related to convertible note transaction (9.6)        (10.3)        (7.6)      
    Non-GAAP weighted average common shares - diluted 177.2         177.4         172.7       
                             
    (1)Restructuring and other consists of:                       
      Quarter Ended      
      July 4,
    2021    		       April 4,
    2021    		       June 28,
    2020    		      
     Employee severance$0.4        $0.2        $-       
     Acquisition related expenses and compensation 0.3         (0.2)        3.1       
     Contingent consideration fair value adjustment -         (7.2)        29.3       
     Contract termination settlement fee -         -         4.0       
     Other 1.8         0.1         0.8       
      $2.5        $(7.1)       $37.2       
                             
                             
    (2)For the quarters ended July 4, 2021, April 4, 2021, and June 28, 2020, Interest and other included non-cash convertible debt interest expense. For the quarters ended July 4, 2021 and April 4, 2021, adjustment to exclude loss on convertible debt conversions. For the quarters ended July 4, 2021 and June 28, 2020, adjustments to exclude actuarial (gain) recognized under GAAP in accordance with Teradyne's mark-to-market pension accounting.
                             
    (3)For the quarters ended July 4, 2021, April 4, 2021, and June 28, 2020, the non-GAAP diluted EPS calculation adds back $0.9 million, $1.2 million, and $1.3 million of convertible debt interest expense to non-GAAP net income, and non-GAAP weighted average diluted common shares include 10.1 million, 9.4 million and 5.8 million shares, respectively, from the convertible note hedge transaction.

     

        Six Months Ended
        July 4,
    2021    		 % of Net Revenues     June 28,
    2020    		 % of Net Revenues    
                       
    Net Revenues $1,867.3        $1,543.0       
                       
    Gross profit GAAP$1,108.6   59.4%     $877.0  56.8%    
     Inventory step-up -   -       0.2  0.0%    
    Gross profit non-GAAP$1,108.6   59.4%     $877.2  56.9%    
                       
    Income from operations - GAAP$621.9   33.3%     $424.7  27.5%    
     Restructuring and other (1) (4.6)  -0.2%      29.6  1.9%    
     Acquired intangible assets amortization 10.9   0.6%      18.8  1.2%    
     Inventory step-up -   -       0.2  0.0%    
    Income from operations - non-GAAP$628.2   33.6%     $473.3  30.7%    
                       
            Net Income
    per Common Share    		     Net Income
    per Common Share
        July 4,
    2021    		 % of Net Revenues Basic  Diluted June 28,
    2020    		 % of Net Revenues Basic  Diluted
    Net income - GAAP$533.8   28.6% $3.21  $2.85  $365.1  23.7% $2.20  $2.02 
     Restructuring and other (1) (4.6)  -0.2%  (0.03)  (0.02)  29.6  1.9%  0.18   0.16 
     Acquired intangible assets amortization 10.9   0.6%  0.07   0.06   18.8  1.2%  0.11   0.10 
     Loss on convertible debt conversions (2) 5.2   0.3%  0.03   0.03   -  -   -   - 
     Interest and other (2) 6.9   0.4%  0.04   0.04   7.1  0.5%  0.04   0.04 
     Inventory step-up -   -   -   -   0.2  0.0%  0.00   0.00 
     Pension mark-to-market adjustment (2) (0.6)  -0.0%  (0.00)  (0.00)  (0.1) -0.0%  (0.00)  (0.00)
     Exclude discrete tax adjustments (16.3)  -0.9%  (0.10)  (0.09)  (8.7) -0.6%  (0.05)  (0.05)
     Non-GAAP tax adjustments (1.9)  -0.1%  (0.01)  (0.01)  (10.1) -0.7%  (0.06)  (0.06)
     Convertible share adjustment (3) -   -   -   0.16   -  -   -   0.10 
    Net income - non-GAAP$533.4   28.6% $3.21  $3.02  $401.9  26.0% $2.42  $2.34 
                       
    GAAP and non-GAAP weighted average common shares - basic 166.2         166.2       
    GAAP weighted average common shares - diluted 187.2         180.5       
     Exclude dilutive shares from convertible note (9.9)        (7.5)      
    Non-GAAP weighted average common shares - diluted 177.3         173.0       
                       
    (1)Restructuring and other consists of:               
        Six Months Ended      
        July 4,
    2021    		       June 28,
    2020    		      
      Contingent consideration fair value adjustment$(7.2)       $19.2       
      Employee severance 0.6         0.8       
      Acquisition related expenses and compensation -         4.5       
      Contract termination settlement fee -         4.0       
      Other  1.9         1.1       
        $(4.6)       $29.6       
                       
    (2)For the six months ended July 4, 2021 and June 28, 2020, Interest and other included non-cash convertible debt interest expense. For the six months ended July 4, 2021, adjustment to exclude loss on convertible debt conversions. For the six months ended July 4, 2021 and June 28, 2020, adjustments to exclude actuarial (gain) loss recognized under GAAP in accordance with Teradyne's mark-to-market pension accounting.
                       
    (3)For the six months ended July 4, 2021 and June 28, 2020, the non-GAAP diluted EPS calculation adds back $2.1 million and $2.6 million, respectively of convertible debt interest expense to non-GAAP net income and non-GAAP weighted average diluted common shares include 9.8 million and 5.7 million shares, respectively related to the convertible debt hedge transaction.


    GAAP to Non-GAAP Reconciliation of Third Quarter 2021 guidance:   
          
    GAAP and non-GAAP third quarter revenue guidance: $880 millionto$960 million
    GAAP net income per diluted share $1.17  $1.41 
    Exclude acquired intangible assets amortization  0.03   0.03 
    Exclude non-cash convertible debt interest  0.02   0.02 
    Tax effect of non-GAAP adjustments  (0.01)  (0.01)
    Convertible share adjustment  0.08   0.09 
    Non-GAAP net income per diluted share $1.29  $1.55 
          


    For press releases and other information of interest to investors, please visit Teradyne's homepage at http://www.teradyne.com.
     Contact: Teradyne, Inc.
      Andy Blanchard 978-370-2425
      Vice President of Corporate Relations
       

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